A Vancouver Venture PeopleSoft Inc., based in Pleasanton, Calif., announced in November 2002 a US$12.8-million investment in a North American support and development center in Vancouver, British Columbia. An initial staff of 75 people filled the 25,000-sq.-ft. (2,323-sq.-m.) leased facility when it opened in February. The predominantly open office environment at PeopleSoft is a perfect fit with the open-air sophistication of Vancouver, B.C. Photo: Tourism Vancouver         "PeopleSoft selected Vancouver after an extensive search," said PeopleSoft President and CEO Craig Conway at the announcement. "Vancouver is the ideal location for our new center because of its highly skilled workforce and strong commitment to IT education, research and training."         John Lucas, vice president of real estate, oversees the company's worldwide portfolio of some 2.8 million sq. ft. (260,120 sq. m.) of office space, broken up into three arenas: 1.4 million sq. ft. (130,060 sq. m.) of corporate space, much of it in Pleasanton; the American Theater, made up of both North and South America; and the Europe, Middle East, Africa and Asia Pacific theater. He says the global support center growth initiative dovetailed both strategically and chronologically with activity in Vancouver.         "We took a look at where PeopleSoft wanted to grow and expand its global support on a worldwide basis and basically took a 'follow the sun' type of approach," he says. "We looked at a global market, which included Beijing, Amsterdam, Sydney, Tokyo, Sao Paulo and Vancouver." Keeping It Together Existing business in Vancouver, where the company already has consulting services, sales and R&D groups, was a strong persuader, as was the metropolitan statistical analysis that Lucas, Troy Ward (director of Americas real estate) and their colleagues conducted.         "Vancouver came out weighing very well," says Lucas. "There was also a recognition that it would make sense to keep our existing operation and any GSC operation together."         Synergy with the high-tech work force and corporate population in Vancouver was another plus, as were basic real estate decision-drivers.         "When our GSC Group approached us about where they'd like to expand their functions, they had some locations already in mind," he explains. "We circled the wagons and reviewed regionally where we already had facilities, and where those facilities had lease dates or activity that would drive a real estate decision in the near future. And we tried to bring that together with this initiative to expand the GSC. We had a lease termination date coming up in Vancouver, so we had an event that was going to take place anyway, or at least the need to look at Vancouver as far as what our future disposition there might be. So right off the bat, when we looked at a West Coast hub and started looking at where we might put that and compared that to our portfolio of real estate, it came up that Vancouver is a very likely place, and in the end seemed a very fitting place to be from everybody's perspective." Good Time For Tenants Lucas says basic market-driven real estate incentives like rent, tenant improvement allowance, expansion options, termination options – "the typical landlord/tenant negotiations" – were crucial, even though the company's approach to its office environments is fairly straightforward. PeopleSoft generally aims for a 20-percent closed, 80-percent open office environment, with a goal of 200 sq. ft. (18.6 sq. m.) per person. Initial plans call for staffing of 75 immediately, with a four-year expansion horizon of 122 people.         "We have other expansion options built into our lease – I just can't pin down exactly what the growth is going to be," he says. "You venture out on these real estate transactions that have longer time horizons, and the business is working off a quarter-by-quarter view of the world. Ask me next quarter, and the projection for growth might be different."         Time does funny things to negotiations too, says Lucas. When asked about business climates across various jurisdictions, he says it's a good time to be a tenant anywhere.         "I think most regions domestically and around the world are highly incented these days to attract growing companies," he says. "Canada wouldn't be any different, whether it's Toronto or Ottawa or Montreal or Vancouver. It's coupled right now with the basic facts about real estate around the world today – landlords are hurting for tenants, so they're highly incented to cooperate and provide balanced leases and a lease negotiation process. Landlords are receptive to the needs of tenants, whereas if you asked me that question four years ago, I would have said the opposite." — Adam Bruns